REA bids - health of the hobby

[kickitup]

Prices for the rarest and the best have only begun to rise.

Invest in quality for the grade and don't leverage yourself and you will do fine long term. You only get burned when you 'have to' sell.

Cracker jacks will likely go next, after goudeys take off. Then my hunch is t206 cards rocket ship. There aren't enough good cards to go around.

Plus..... The biggest factor causing the rise in prices is PSA's grading standards have changed. People bitch and complain about how hard it is to get a bump now, but their new strict policies are exactly what has caused the hobby prices to sky rocket. Supply is perceived to be capped now with increasing demand.

I like being long cards with those fundamentals.

Kick it up!

[uniship]

For the past 35 years I have been wondering when cards will come back to earth. They just keep doing well for the most part. It seems now cards might be going "mainstream" to outside investors. If this is indeed true, fasten your seatbelts - we may one day long to be able to buy at 2015 prices.

Then again who the hell knows.

[sjim8660]

Originally Posted by uniship

For the past 35 years I have been wondering when cards will come back to earth. They just keep doing well for the most part. It seems now cards might be going "mainstream" to outside investors. If this is indeed true, fasten your seatbelts - we may one day long to be able to buy at 2015 prices.

Then again who the hell knows.

Tell me about it. I remember 10 years ago not wanting to buy a PSA 10 Elway RC because it was "too much" lol. Now they are what $5-$6K a pop lol. Same can be said for the obvious 52' Mantle that is going into uncharted water in terms of price. A PSA 10 52' Mantle is being rumored at $2 Mil. The fact is, its more fun to invest in vintage cards than buying stock or even gold and right now its more profitable lol.

[uniship]

honestly with the way things have been going - I bet that card would sell for even more - perhaps MUCH more - than $2m

[T206Collector]

It is hard to ignore the market, but every once in awhile it gives me nausea to consider the irrationality of a market for little pieces of cardboard with baseball players on them that carry little to no value in any other part of the world, and are not directly correlated to any form of universal currency like gold. It's like art, I guess, and I seem to calm down more when I think of it as so. Picasso may be hot today, but maybe in 50 years people will think he is crap - another totally irrational market.

[goudey1933]

I'm just throwing this scenario out there....PSA goes out of business....what would happen?I know there not but lets pretend.
Scott

[glchen]

Originally Posted by goudey1933

I'm just throwing this scenario out there....PSA goes out of business....what would happen?I know there not but lets pretend.
Scott

Discussed before here: Link

[4815162342]

Originally Posted by T206Collector

It is hard to ignore the market, but every once in awhile it gives me nausea to consider the irrationality of a market for little pieces of cardboard with baseball players on them that carry little to no value in any other part of the world, and are not directly correlated to any form of universal currency like gold. It's like art, I guess, and I seem to calm down more when I think of it as so. Picasso may be hot today, but maybe in 50 years people will think he is crap - another totally irrational market.

If the card market crashes, it'll just mean I can buy more cards.

[bobfreedman]

Retracted

[pokerplyr80]

Originally Posted by uniship

honestly with the way things have been going - I bet that card would sell for even more - perhaps MUCH more - than $2m

You're right about that. A 9 would sell for more than 2 mil right now. A 10 who knows? I would guess 5 or 6.

[kailes2872]

Originally Posted by pokerplyr80

You're right about that. A 9 would sell for more than 2 mil right now. A 10 who knows? I would guess 5 or 6.

So is the PSA 10 #311 the most valuable card in Ken Kendrick's collection on the trimmed T206 Wagner?

[pokerplyr80]

Originally Posted by kailes2872

So is the PSA 10 #311 the most valuable card in Ken Kendrick's collection on the trimmed T206 Wagner?

It would be interesting to find out. I think they would be pretty close right now. It doesn't sound like he will ever sell either but maybe some day. It wouldn't surprise me if some private collector with a lot of money offered 10m for either of those cards privately.

[AGuinness]

Originally Posted by kickitup

Plus..... The biggest factor causing the rise in prices is PSA's grading standards have changed. People bitch and complain about how hard it is to get a bump now, but their new strict policies are exactly what has caused the hobby prices to sky rocket. Supply is perceived to be capped now with increasing demand.

I like being long cards with those fundamentals.

Kick it up!

Isn't this shift in PSA standards fairly recent? I can't see that as the biggest factor in rising prices, because as others have noted elsewhere, prices have been rising fast for many years - even 10 or 15 years.

I wonder if the shift in PSA standards could potentially create a split market, where cards with new flips (graded with new standards) are basically in a different ballpark than old flips, which would make their grade unreliable (although perhaps not entirely irrelevant).

This is more of an open question in my mind...

[Econteachert205]

Wall Street cards: high grade rookies, registry building, prewar mid to high-doing fine


Main Street cards: everything else: mediocre.

[DeanH3]

Originally Posted by AGuinness

Isn't this shift in PSA standards fairly recent? I can't see that as the biggest factor in rising prices, because as others have noted elsewhere, prices have been rising fast for many years - even 10 or 15 years.

I wonder if the shift in PSA standards could potentially create a split market, where cards with new flips (graded with new standards) are basically in a different ballpark than old flips, which would make their grade unreliable (although perhaps not entirely irrelevant).

This is more of an open question in my mind...

Keep in mind older graded cards will be re-holdered so you can't always rely on a newer flip = newly graded.

[AGuinness]

Originally Posted by DeanH3

Keep in mind older graded cards will be re-holdered so you can't always rely on a newer flip = newly graded.

I guess I figured there might be some sort of review possible when submitting for a new holder (which might be useful to a TPG who may have graded a card and later information about alterations came to light, but just hypothetically speaking - that couldn't happen, right?).

[nat]

I'm just thinking out loud here, so don't construe any of this as investment advice. But it's worth asking why the prices of high-end cards have gone through the roof (and, as noted up thread, that of lower end cards haven't). One possible explanation is that it's driven by increasing wealth inequality. Sure, correlation isn't causation, but the two have been increasing in tandem. Concentrating money in fewer hands means that those with the money can afford to drop larger sums on baseball cards. If that's what's doing it, then, at least in the long run, high-end baseball card prices are in trouble.

That's because, for prices to continue to rise would require further consolidation of wealth (so that there's somebody out there who can afford to spend even more on cards), but, at some point, this process will backfire. At some point, this will require shrinking the pool of wealthy people (so that the remaining wealthy people have enough money to afford the very expensive cards), but as you do that you increase the risk that the remaining wealthy people (who are interested in baseball cards, it's not like all the wealthy people are buying cards) already have the cards that they want. Kendrick probably isn't the market for another t206 Wagner, for example. And at that point the price of high-end cards collapses.

In short the problem is that increasing prices requires two things: a population of people who have ever increasing amounts of money, and a population of people who are willing to compete against each other to buy the cards. But if the first part of this equation is growing because of increasing wealth inequality, it means that the second part is shrinking. And if the number of people who can spend huge amounts of money on cards shrinks far enough, it doesn't matter how much money they have, there won't be the competition for cards that supports card prices.

Now I don't know that this is what's driving the value of the high-end cards. But it might be. If their price is increasing faster than the growth of the economy as a whole, or faster than the real growth rate of the top end of the economy, then something has got to explain it. And I don't have any better guesses as to what it might be.

[1952boyntoncollector]

Originally Posted by nat

I'm just thinking out loud here, so don't construe any of this as investment advice. But it's worth asking why the prices of high-end cards have gone through the roof (and, as noted up thread, that of lower end cards haven't). One possible explanation is that it's driven by increasing wealth inequality. Sure, correlation isn't causation, but the two have been increasing in tandem. Concentrating money in fewer hands means that those with the money can afford to drop larger sums on baseball cards. If that's what's doing it, then, at least in the long run, high-end baseball card prices are in trouble.

That's because, for prices to continue to rise would require further consolidation of wealth (so that there's somebody out there who can afford to spend even more on cards), but, at some point, this process will backfire. At some point, this will require shrinking the pool of wealthy people (so that the remaining wealthy people have enough money to afford the very expensive cards), but as you do that you increase the risk that the remaining wealthy people (who are interested in baseball cards, it's not like all the wealthy people are buying cards) already have the cards that they want. Kendrick probably isn't the market for another t206 Wagner, for example. And at that point the price of high-end cards collapses.

In short the problem is that increasing prices requires two things: a population of people who have ever increasing amounts of money, and a population of people who are willing to compete against each other to buy the cards. But if the first part of this equation is growing because of increasing wealth inequality, it means that the second part is shrinking. And if the number of people who can spend huge amounts of money on cards shrinks far enough, it doesn't matter how much money they have, there won't be the competition for cards that supports card prices.

Now I don't know that this is what's driving the value of the high-end cards. But it might be. If their price is increasing faster than the growth of the economy as a whole, or faster than the real growth rate of the top end of the economy, then something has got to explain it. And I don't have any better guesses as to what it might be.

its really about now and meaningful life...of course nothing goes up for forever..but tell that to the guy that bought a psa 5 RC Mantle for 25k 3 years ago and sold for 70k...

can speculate all we want.....my canary is how much classic high end commons go for...like psa 8 1952 topps or low POP cards..........its the commons high grade which sort of tells us the hobby as a whole.....many have said whether its artwork, coins or stamps...there usually is a market for holy grail things.......